HAU SING TSO AND OTHERS v. SECRETARY FOR JUSTICE

HCMP 1431/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1431 OF 2014

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DECISION

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Introduction

1.  This is the hearing of the Defendant’s application to join five other intended defendants to these proceedings (the “joinderapplication”). 

2.  By their originating summons dated 12 June 2014 (the “Plaintiffs’ Summons”), the Plaintiffs seek, inter alia, as against the Defendant, ie the Secretary of Justice representing the government:

(1) a declaration that HAU Hing‑mun (侯興門) is also known as HOU Qingmen(侯慶門)[1] and HAU Kun‑pui (侯根培);

(2) a declaration that the Plaintiffs are the lawful heirs to HAU Hing‑mun;

(3) a declaration that To Ti Wui(土地會) (the “Wui”) is the registered owner of a property known as Lot No 1151 and the Remaining Portion of Lot No 1151 in DD 95 in Ho Sheung Heung (河上鄉) (the “Property”);

(4) a declaration that the Plaintiffs be entitled to be appointed as managers of To Ti Wui; and

(5) an order that compensation moneys for the resumption of the Property to be paid to the Wui be paid to the Plaintiffs as managers of the Wui.

3.  On 27 October 2016, the Defendant took out the present summons seeking to join five other persons (the “objectors”) as co‑defendants (the “joinder application”). A week later, on 4 November 2016 the parties made a joint application and obtained directions by consent to adjourn the Plaintiffs’ Summons to a date to be fixed for full argument.

Backgrounds

4.  According to the Block Crown Lease of DD 95 issued in 1905, the registered owner of the Property prior to its resumption by government was To Ti Wui with HAU Hing‑mun(侯興門) as its trustee (司理).  The middle character of that name was actually “”, which I accept is the simplified character for “興”.  However, in the Rent Roll “A” Book Vol 48 Folio 98, the registered owner of the Property was recorded as HAU To Ti Wui (侯土地會) with HAU Hing‑yiu (侯興耀) as the trustee. The Property was resumed by two stages in 1984 and 1999.  The manager, whoever he was, must have deceased by the time of issue of the Plaintiffs’ Summons.  The compensation moneys are now held by the government pending release to the Wui upon appointment of the new manager.  In the course of time, the following four applications for appointment as managers of To Ti Wui and HAU To Ti Wui were made:

(1) by the 1^st, 2^nd and 4^thPlaintiffs on 9 March 1999;

(2) by HAU Chun‑fai and HAU Yuet‑yau on 15 July 1999;

(3) by HAU Chun‑fai on 5 September 2000; and

(4) by the 4^thPlaintiff and HAU Nin‑yau on 16 October 2007.

5.  In the first application, the 1^st, 2^nd and 4^thPlaintiffs (the “three Plaintiffs”) claimed that their grandfather was HAU Hing‑mun alias HAU Kun‑pui (侯根培) and they are children of HAU Kun‑pui’s son, HAU Wang‑luk (侯宏祿).  They asserted that their grandfather had two other issues, HAU Wang-fuk (侯宏福) and HAU Wang-shau (侯宏壽) who had passed away without leaving any issues.  They produced a genealogy prepared by a committee of the HAU’s clan (侯氏族譜綸纂委員會) which shows that HAU Kun‑pui was a male descendant of the 27^thgeneration of the clan and had three sons, namely HAU Wang‑fuk, HAU Wang‑luk and HAU Wang‑shau; that HAU Wang‑fuk and HAU Wang‑shau had no issues; and the Plaintiffs herein are the sons of HAU Wang‑luk.  They asserted that HAU Kun‑pui was also known as HAU Hing‑mun and HOU Qingmen.  To make good their case that HAU Kun‑pui, HAU Hing‑mun and HOU Qingmen was the same person and their grandfather, they produced some property transfer and mortgage records from the District Land Office in respect of some lots in DD 95, including a number of memorials which show that HAU Wang‑luk and HAU Wang‑shau succeeded Lot 1132 from HAU Hing‑mun on 24 September 1930 and then the latter sold it to the former, ie the Plaintiffs’ father, on 13 January 1938.  They also produced a list of eight beneficiaries for the Wui, including themselves, the 3^rdPlaintiff and their male issues.

6.  Four months later, on 15 July 1999 the second application was received from HAU Chun‑fai and HAU Yuet‑yau for appointment as managers of HAU To Ti Wui.  They subsequently produced a letter dated 10 July 2000 from a village elder, HAU Tim‑shik born in 1921, explaining that the Property was left by the ancestor of several families living in the south side of Ho Sheung Heung; that HAU Hing‑mun and his brother HAU Hing‑yiu agreed to set up HAU To Ti Wui to manage the Property for the benefit of the five families; that HAU Hing‑yiu was appointed manager; that HAU Hing‑yiu died in 1933 and that HAU Hing‑mun died without leaving any descendants.  HAU Chung‑fai and HAU Yuet‑yau produced Crown rent receipts as evidence that the five families paid Crown rent in respect of the Property; and a letter dated 2 April 1984 from the Director of Lands to HAU To Ti Wui offering compensation for resumption of the Property in 1984.

7.  After about a year, on 5 September 2000 HAU Chun‑fai made the third application for appointment as manager of To Ti Wu, but in respect of the same beneficiaries as those set out in the second application.  The Home Affairs Department considered that application was made in respect of HAU To Ti Wui.  With respect, that was an utterly wrong interpretation of the application.  The application was made expressly for appointment as manager of To Ti Wui and in relation to the Property which on the record was registered in the name of To Ti Wui.  The only item out of place was that the list of beneficiaries was different from the one produced by the three Plaintiffs in the first application.  As the events described in the following paragraph unfolds, the identity of the members of To Ti Wui is at the heart of the present dispute.  Thus, there was no mistake that HAU Chun‑fai was applying for appointment as manager of To Ti Wui, which according to his application consisted of different beneficiaries.

8.  The Home Affairs Department sat on these applications for some time.  It was only until after the Plaintiffs’ complaint to the Ombudsman that the Home Affairs Department started to process the first application of the three Plaintiffs.  A notice of their application was posted in Ho Sheung Heung on 8 February 2001.  HAU Chun‑fai, in association with four other families objected (the “objectors”) to the application.  HAU Wing‑cheung, a village representative of Ho Sheung Heung made a declaration on 2 March 2001 repeating what HAU Tim‑shik said in his letter dated 10 July 2000 as summarised in paragraph 6 above.  Then the Home Affairs Department arranged a mediation meeting among the Plaintiffs, the objectors, the village representative and a legislative council member.  No agreement was reached between the Plaintiffs’ camp and HAU Chun‑fai’s camp, except that the Plaintiffs agreed to submit evidence proving that they were the only members of To Ti Wui and to resolve their dispute with the objectors.  In view of the objection, the Secretary for Home Affairs could not ascertain whether the list of beneficiaries submitted by the three Plaintiffs was correct and was unable to decide if the application had received majority consent from the beneficiaries.  By a letter dated 11 June 2001, the Home Affairs Department informed the three Plaintiffs that the department “could not further process” their application.  In response to the Plaintiffs’ solicitors’ letter, the Home Affairs Department also repeated in its letter dated 26 June 2001 that it “would not further process” the Plaintiffs’ application.

9.  Six years later, on 16 October 2007, the 4^thPlaintiff and HAU Nin‑yau jointly submitted the fourth application for appointment as managers of HAU To Ti Wui in place of HAU Hing‑mun, alias HAU Hing‑yiu, who allegedly died in 1934.  The Home Affairs Department did not process this application as it took the view that HAU To Ti Wui was not the owner of the Property.

10.  After another two and half years, the three Plaintiffs re‑submitted their previous application via their then solicitors on 22 July 2010. Despite mediation by the Home Affairs Department, the two camps could not agree to a list of beneficiaries of To Ti Wui.  In reply to the Plaintiffs’ solicitors’ letter, the Home Affairs Department repeated that it was “unable to further process” the Plaintiffs’ application.

11.  There were further mediation and exchanges of correspondence between the Plaintiffs and the Home Affairs Department.  On 26 June 2013, the Home Affairs Department informed the Plaintiffs that it had no authority to arbitrate on the authenticity of the family trees provided by the two camps and suggested the Plaintiffs to seek adjudication from court.

12.  A year later, on 12 June 2014, the three Plaintiffs together with the 3^rdPlaintiff took out the present summons.  The Secretary for Justice promptly responded on 9 July 2014 inviting the Plaintiffs to join the objectors as co‑defendants and intimated that unless they did so the Defendant would make the application and claim costs against them.  The Plaintiffs did not respond.  Eventually, on 27 October 2016, the Defendant took out the present application.  One week later, on 4 November 2016 the Plaintiff and the Defendant made a joint application and obtained directions by consent to adjourn the Plaintiffs’ Summons to a date to be fixed for full argument.

The nature of the Plaintiffs’ Summons

13.  The thrust of the Plaintiffs’ objection to the joinder application is that it would change the course of the Plaintiffs’ Summons.  The underlying premise of that argument is that the only relief sought by the Plaintiffs is against the government and hence it is unnecessary to bring in any other parties.  I shall deal with this issue before dealing with the Plaintiffs’ substantive grounds of objections.

14.  Mr Wong, counsel for the Plaintiffs, submitted that the application under the Plaintiffs’ Summons was founded on section 15 of the New Territories Ordinance, the purpose of which was confined to the determination as to whether the decision of the Secretary for Home Affairs to defer approving the Plaintiffs’ application for appointment as managers of To Ti Wui on the documentary proof produced by the objectors was justified or not.  The reason for that decision, as confirmed by Tang’s affirmation filed on behalf of the Home Affairs Department, was that the department felt that the decision was justified on the basis of the documentary proof produced by the objectors.  For the purpose of the joinder application, it is not necessary for me to deal with that question today.

15.  Mr Wong cites section 15 of the New Territories Ordinance, which provides as follows:

“ Whenever any land is held from the Government under lease or other grant, agreement or licence in the name of a clan, family or t’ong, such clan, family or t’ong shall appoint a manager to represent it. Every such appointment shall be reported at the appropriate New Territories District Office of the Home Affairs Department, and the Secretary for Home Affairs on receiving such proof as he may require of such appointment shall, if he approves thereof, register the name of the said manager who shall, after giving such notices as may be prescribed, have full power to dispose of or in any way deal with the said land as if he were sole owner thereof, subject to the consent of the Secretary for Home Affairs, and shall be personally liable for the payment of all rents and charges and for the observance of all covenants and conditions in respect of the said land. Every instrument relating to land held by a clan, family or t’ong, which is executed or signed by the registered manager thereof in the presence of the Secretary for Home Affairs and is attested by him, shall be as effectual for all purposes as if it had been executed or signed by all the members of the said clan, family or t’ong. The Secretary for Home Affairs may on good cause shown cancel the appointment of any manager and select and register a new manager in his place. If the members of any clan, family or t’ong holding land do not within 3 months after the acquisition of the land make and prove the appointment of a manager, or within 3 months after any change of manager prove the appointment of a new manager, it shall be lawful for the Government to re‑enter upon the land held by such clan, family or t’ong, which shall thereupon become forfeited. Such re‑entry shall be effected by the registration of a memorial thereof in the Land Registry.” (Emphasis added)

By relying on the underlined part of that section, Mr Wong submitted that the duty of the Secretary for Home Affairs was to approve the Plaintiffs’ appointment, if he was satisfied with the evidence submitted by the Plaintiffs, or to dismiss it, if he was not.  That, he submitted, was what the Plaintiffs were seeking by their summons.

16.  Mr Leung, counsel for the Defendant, submitted that the relief sought under the Plaintiffs’ Summons went well beyond challenging the decision of the Secretary for Home Affairs.  The Plaintiffs were not seeking a remedy solely against the Secretary for Home Affairs.  In addition to seeking a declaration that they were entitled to be appointed as managers of To Ti Wui, which effectively amounted to an injunction requiring the Secretary for Home Affairs to approve their appointment, the Plaintiffs were also seeking a declaration against the whole world that HAU Hing‑mun was also known as HOU Qingmen and HAU Kun‑pui, that they were lawful heirs to the said HAU Hing‑mun and an order that the government pay over the compensation moneys held for To Ti Wui to the Plaintiffs.  The declaration sought would affect the interest of the objectors who objected to the Plaintiffs’ application for appointment as manager of To Ti Wui.  The order to pay would extinguish their asserted interest over the compensation moneys.

17.  The compensation moneys held by the government are not personal property at the disposal of the Secretary for Home Affairs. It is being held by the government pending release to To Ti Wui upon appointment of its manager.  In substance, the relief sought by the Plaintiffs’ Summons is for payment of the compensation moneys.  The objectors have raised objection to the Plaintiffs’ appointment and indicated their interest in the compensation moneys.  The subject matter of this litigation is the compensation moneys.  The course set by the Plaintiffs Summons goes well beyond requiring the Secretary for Home Affairs to approve or dismiss their application for appointment as managers of To Ti Wui, but cover payment of the compensation moneys as well.

18.  Next, Mr Wong argued that the proposed joinder would change the course of the proceedings because it will require the court to determine whether the grounds of objection of the objectors, who may notnecessarily be confined to those identified by the Home Affairs Department, were justified or not. There would be factual disputes, which could not be resolved on affidavit evidence in originating summons proceedings.  It may even be necessary to transfer the proceedings into a writ action requiring everything to start afresh.

19.  In the light of the background, it is obvious that there will be serious factual disputes, which could not be resolved on affidavit evidence.  Though vivavoce evidence may be inevitable, the issues are fairly well identified. The Plaintiffs’ application under the summons could still be continued by way of originating summons procedure.  But, if justice requires it to be converted to a writ action, then so be it.  Justice cannot be compromised for economic reasons.

The law of joinder: Order 15, rule 6

20.  The joinder application was made pursuant to Order 15, rule 6 of the Rules of the High Court.  The legal principles applicable to a joinder application are well settled and not in dispute.  Order 15, rule 6 gives the court jurisdiction to add a party to the proceedings at any stage.  The purpose of joinder is to bring all parties to the dispute relating to the same subject matter before the court at the same time so that the dispute may be determined without the delay, inconvenience and expense of separate actions and trials.  This is to ensure that as far as possible all matters in dispute between the parties are completely and finally determined, and any multiplicity of legal proceedings with respect to any of those matters be avoided: Lin Man Yuan v Kin Ming Holdings International Ltd[2].  As to whether a new party should be joined, the test is whether there is a bonafide claim and a proper question to be tried as between the plaintiff and the intended defendant that is necessary or just and convenient for resolution between them as well as between the plaintiff and the defendants: Hong Kong Civil Procedure 2017[3].  At this stage of the proceedings, there is no need for the applicant to show merits: Wong Shan Shan and another v The Incorporated Owners of Yue Wah Mansion and another[4].

21.  Mr Wong submitted that the objectors did not have a bonafide claim and the joinder would not assist in the just and convenient resolution of the dispute.

Bona fide claim

22.  Basically, Mr Wong repeated his argument that under section 15 of the New Territories Ordinance, the duty of the Secretary for Home Affairs was to approve or to dismiss an application for appointment as manager of a t’ong or a wui for that matter.  He submitted that approving whether the proof submitted by the Plaintiffs in support of their appointment was sufficient and approving the list of beneficiaries of a wui or t’ong were matters solely within the confines of the responsibility of the Secretary for Home Affairs and it was not necessary for the court to be troubled with.

23.  Mr Leung, counsel for the Defendant, submitted that if that was right the Plaintiffs were in fact seeking by the backdoor a judicial review of the decision of the Secretary for Home Affairs out of time as the Home Affairs Department had informed the Plaintiffs by letter dated 11 June 2001, 26 June 2001 and 16 July 2001 that the department could not further process the Plaintiffs’ application.  In reply, Mr Wong argued that the effect of those letters was to keep the application on hold and not a decision to dismiss the application. 

24.  With respect, all these arguments are unnecessary.  This is not a judicial review.  As I have held, the Plaintiffs’ Summons went beyond challenging the decision of the Secretary for Home Affairs or seeking a personal remedy against him.  The real subject matter of the Plaintiffs’ Summons is the compensation moneys held by the government for To Ti Wui.  The Plaintiffs were seeking relief against the whole world, particularly against the objectors.

25.  Mr Wong submitted that the Secretary for Home Affairs was well aware that the intended 2^nd to 6^th Defendants had put forth a submission and a list of members of a different wui, namely HAU To Ti Wui, claiming to be the rightful parties to replace the late HAU Hing‑mun, but now the 2^nd to 4^th intended Defendants claimed that they were members of To Ti Wui.  He suggested lack of good faith or credibility in their claim.  Be that as it may, at this stage of the proceedings, there is no need for the Secretary for Home Affairs to show merits.  If there are other parties who have expressed interest in the subject matter of the litigation and have produced prima facie evidence of their entitlement, it is appropriate that they should be made a party so that all the controversies in dispute could be conveniently resolved together and finally.

Just and convenient resolution

26.  Mr Wong argued that apart from the five intended defendants which the Secretary for Home Affairs wished to join, there would be an ever growing number of people who would become entitled to claim as beneficiaries of To Ti Wui.  Hence, joining the five intended beneficiaries would not bind all potentially interested parties and therefore would not finally resolve the dispute.  The Property held by To Ti Wui is treated as being held on the same basis as property held by a t’ong.  The head of family is deemed to represent all the present and future members of the family in respect of their interest in the property of the t’ong.  The same applies to the property of the Wui.  There are only five families in Ho Sheung Heung known to the Secretary for Home Affairs which are interested in the Wui or the Property.  These families are represented by the five intended defendants.  Joining the five intended defendants would achieve a just and final resolution of the present dispute.

27.  Mr Wong argued that if the objectors are really minded to contest the Plaintiffs’ Summons and to seek to be appointed as managers there was a duty on their part to seek proper legal advice and seek to be joined.  It has been two years since the issue of the Plaintiffs’ Summons and the Plaintiffs’ intention to be appointed has been widely circulated in the district.  Despite that none of the objectors had come forward to seek to be joined as a party.  Mr Wong therefore argued that from the above circumstances it could be inferred that they were spoilers causing mischief to the Plaintiff for reasons best known to themselves and that they did not have a genuine claim to the subject matter of the Plaintiffs’ Summons.

28.  I do not agree.  While the Plaintiffs’ intention to be appointed as managers of To Ti Wui must be well known to the objectors and there were negotiations between the Plaintiffs and the objectors to agree to a list of beneficiaries, it is speculative whether they knew that the Plaintiffs had taken out the present Summons.  Like the Plaintiffs, HAU Chun‑fai had applied for his own appointment as manager of To Ti Wui, though unknown to him the Home Affairs Department assumed that he was applying to be appointed as manager of HAU To Ti Wui.  He and the other four families, which presumably supported him in the application, might assume that his application was still extant and the Home Affairs Department would inform them of any adverse development or take steps to ensure that their interest would not be overlooked, which was what the Secretary for Justice is now doing.

29.  Besides, the objectors do have evidence in support of their objection to the Plaintiffs’ application.  They had been using the Property prior to its resumption.  They paid Crown rent and were treated as the beneficiaries of the owner of the Property because compensation had been offered to them as beneficiaries of HAU To Ti Wui.  I would not draw the inference that they are spoilers who have no bona fide claim.

Election not to make a joinder application

30.  Mr Wong argued that the Secretary for Home Affairs had elected not to join any other parties and is bound by his election. He relied on the follow facts as exercise of the election.  Shortly after the issue of the Plaintiffs Summons, on 9 July 2014 the Secretary for Justice wrote issued the Plaintiffs’ solicitors inviting them to join the objectors and threatening that he would do so if the Plaintiffs did not and would claim costs against them.  He submitted that clearly there was a choice to take out the joinder application at that stage or to go ahead with the originating summons proceedings without joining the objectors.  He argued that the Secretary for Justice had taken an active role in not only consenting to extension of time for the Plaintiffs to file their affirmations out of time, but also filed an additional affirmation to secure the position of having the “last word” to the proceedings.  The delay in taking out the joinder application at this stage when all affirmations have been filed created procedural complications.  He therefore argued that by filing two affirmations dated 1 September 2014 and 9 September 2016, the Secretary for Justice has exercised the election.

31.  As early as 9 July 2014, the Secretary for Justice had intimated that he would take out a joinder application if the Plaintiffs did not.  He never resiled from that position.  He even renewed the threat in March 2016.  It was not until August 2016 that the Plaintiffs finalised their case and sought leave to file another affirmation.  The Secretary for Justice acted reasonably by consenting to the request except to ask for leave to file a reply affirmation to deal with any new matters raised by the Plaintiffs.  I am unable to see how the filing of affirmation by the Defendant could be taken as exercise of the election to abandon the joinder application.  Though all affirmations had been filed, directions for setting the Plaintiffs’ Summons down for argument has not been given until 4 November 2016.  But a week before that, the Secretary for Justice had made the joinder application.  There is no prejudice caused by the joinder application.  If any election has been made, it was an election to proceed with the joinder application.  Interest of justice requires that the application be allowed.

Conclusion

32.  I am satisfied that application meets the requirements for joinder prescribed by Order 15, rule 6.  Accordingly, I allow the Defendant’s application with costs.